If you are thinking about getting into real estate investment then now is the perfect time to really spend some time planning how you are going to attack this. Admittedly you are always going to make the odd mistake in the beginning, but just like with anything else you will learn from those mistakes. Prior to making your first investment however you have a golden opportunity to really do your homework and make sure that you have everything lined up to make the very best investments, and to ensure that you give yourself the best chance of success. To help you do that, we have the brilliant Ali Ata, real estate guru, who has some great tips.
When searching for a property it is essential that you find the market with the best value for an investor. The mistake that many make is to only look in their own back yard, when in actual fact there may be much better value in other cities or even beyond state lines. Don’t restrict yourself to a local investment if there is better value elsewhere.
Something which you should really look into is areas of the state or across the country which are growing at a fast rate. This normally happens when a government project or a large investment into a certain area is made, which is going to bring about jobs. As more people move to these places the demand goes up and so too do prices, and if you got in first then you can make a killing. Another type f location that this happens in is outer-cities, if you see city prices skyrocketing then you can be sure that people are looking too the suburbs so that they can stay close to the city, without paying the cost.
This is the perfect time to start learning about how you are going to calculate the value of a property, and I don’t mean in financial terms. We are talking about the value of a property to the people who are buying it, which is very different. For example if you see a family home which looks great, is well priced and appears to offer good value, it can be tempting to dive right in. If however that property is in an area of high crime, with no schools or hospitals nearby and with poor public transport options, it just isn’t going to sell. The property is only half the battle, you have to ensure that everything else is in place too.
Who Are You?
Finally you should be thinking about what type of investor you are going to be, will you be looking to buy and sell quickly? Look to own multiple properties and rent them out long term? Or will you look to buy at the low end of the market and rent it out until the price goes up? This is going to dictate your decisions, and your cash flow, so be sure to make that decision before you get started.